Fred’s reports 5 percent sales increase for six months to August 4

MEMPHIS, Tenn. Fred’s last week reported sales of $866.9 million, up 5 percent, for the six months ended August 4. Comparable store sales for the year to date in 2007 increased 1.3% versus 2.5% in the year-earlier period.

“Despite the headwinds we encountered this past quarter, we were pleased to witness improved operating performance in our pharmacy department, where the shift to generic drugs, while hurting sales, actually helped our margins,” stated Michael Hayes, Fred’s chief executive officer. “During August, we have gained momentum with our merchandise refresher program, as sales of new product categories are now exceeding those of the product categories we are exiting. We believe these factors will continue to pay dividends for Fred’s in the last half of the year.”

Fred’s gross profit for the second quarter increased 6 percent to $121.5 million. Gross margin for the quarter rose to 28.6 percent, up 30 basis points from last year. The margin improvement was attributable primarily to the continuing shift from branded to generic drugs in Fred’s pharmacy department sales.

Union ratifies new contract for Puget Sound-area grocery workers

SEATTLE After five months of negotiations, union and management announced Tuesday that a contract agreement had been reached for grocery workers in Puget Sound-area Safeway, QFC, Fred Meyer and Albertsons stores, the Seattle Post-Intelligencer reported.

Workers ratified with 92 percent approval a 3-year deal, which covers more than 20,000 people, including cashiers, clerks and meat department employees.

“This is a great contract for grocery workers,” said Jackie O’Ryan, a spokeswoman for United Food and Commercial Workers Local 21. “They set very strong, clear goals from the beginning that they wanted strong wage increases and health care to be more affordable, and they met those goals and more.”

Highlights of the deal include fully covered in-network preventive care, insurance coverage beginning the fourth month of employment rather than the tenth, a prescription plan that includes $5 copays on generics, and wage increases over the next three years of $1.30 per hour.

The deal also features an employer-funded health reimbursement account at $500 per member or $1,000 per family and same-sex partner benefits.

“It’s rather remarkable,” O’Ryan told the Post-Intelligencer, “when most of corporate America is focused on growing profits by cutting health care benefits,” The negotiations stand in contrast to those earlier this year between Safeway and workers in Southern California, which almost resulted in a strike when there was no agreement three months after the old contract expired.

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NutraMist Crave Control: A spray containing Hoodia, it helps dieters stay in control when tempted with sweets, salty snacks and other “bad foods.” The formula also contains chromium and green tea extract, and it comes in a mint flavor.

NutraMist Immune Boost: A blend of Vitamin C, zinc and echinacea, it boosts immunity with 17 antioxidants and botanicals, and it comes in a tropical burst flavor.

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